Last summer I penned a piece for Forbes.com with the provocative title, “BoeingBA Has Bottomed. It Could Recover Quickly.” At the time I was guessing what the future held for America’s most storied aerospace enterprise, but market developments during the intervening months have tended to support my thesis.

On March 15—the Ides of March—Boeing vice president for commercial marketing Darren Hulst briefed me on the company’s latest market update. It was an eye-opening experience. Boeing Commercial Airplanes, the commercial-transport side of the house that has traditionally generated most company revenues, is going gangbusters.

In fact, the biggest challenge Boeing, a contributor to my think tank, faces at present is simply keeping up with demand. The narrative surrounding the global air travel market has shifted from one of pandemic recovery to the return of normal growth, meaning a 5-6% increase in demand each year.

Last year was the turning point. 2022 began with air travel at roughly 50% of pre-pandemic levels, but by year’s end, that number had risen to 80%. As of January, global air travel had risen to 84% of the pre-pandemic rate, with many markets—most notably North America—approaching the pre-pandemic norm.

For instance, North America in January stood at 99% of pre-pandemic; Latin America at 91%; Europe at 89%; and the Middle East at 89%. Asia has been the laggard thanks mainly to China’s COVID lockdown, but that story is now over and Asia is expected to be the biggest driver of new demand in 2023.

Given a reversion to previous norms in the marketplace, Boeing figures that airlines will require 41,170 new commercial transports over the next 20 years, 75% of which will be single-aisle passenger planes like the 737, 18% of which will be widebody passenger planes, 5% regional jets and 2% freighters.

These percentages reflect the number of aircraft delivered in each category, but not the value of sales. Because widebodies cost so much more than narrow-bodies, they will likely represent over 40% of the market by value, an estimate that tends to favor Boeing’s product line (more on that later).

Boeing expects that demand for aircraft will be distributed fairly evenly across its major markets, with North America representing 23% of demand, Europe 21%, Asia Pacific outside China 21%, and China itself 21%. Latin America and the Middle East collectively will generate 12% of demand, and Africa 2%.

China remains a huge source of demand, but Boeing does not expect the country to be a major supplier of aircraft beyond its domestic market. The market will remain essentially an Airbus-Boeing duopoly, with the main locus of competition being between the Airbus family of A320 single-aisle jetliners and the Boeing 737 MAX family.

Although the MAX got off to a rocky start, it is now smoothly integrating into the global air fleet. Roughly 900 of the planes have been delivered in multiple variants to 55 carriers, and the aircraft are exhibiting 99.55% schedule reliability.

Airbus was able to increase its market share in narrow-bodies during the MAX groundings, but those are now in the past and Boeing notes that the 737-7/8/9/10 each outperforms its closest Airbus counterpart in range. For instance, the 737-8, which carries 178 passengers, can fly over 6,000 kilometers, while the rival Airbus A320neo with 165 passengers can only fly about 5,000 kilometers.

Similar range disparities prevail in each category of the single-aisle market, giving Boeing a significant advantage as longer routes catch up with short-haul routes in the return to normalcy.

A similar circumstance prevails in the widebody segment of the market, where Boeing’s 787 Dreamliner has led in the opening up of 357 new routes around the world—11 times the number of new routes opened up by the A330neo and A350.

Airbus appears to be losing ground in the widebody market thanks in part to its ill-fated bet on the A380 jumbojet. The A350 launched to compete with Dreamliner does not offer the 787’s degree of sophistication, and that is reflected in divergent trends for repeat orders. To date, 52 repeat customers for Dreamliner have ordered 780 planes, whereas ten repeat customers for A350 have ordered a total of 184 planes.

The market thus clearly is favoring the Boeing product. A similar pattern prevails at the top of the market, where Boeing’s 777 twinjet is outperforming it Airbus counterparts. As the market gradually retires four-engine widebodies, it is migrating toward Boeing products. In 2019, Boeing claimed 60% of the widebody market; in 2022 it claimed 64%.

Boeing’s dominance in widebodies is particularly pronounced in freighters, where it pretty much owns the market.

So five years after it began encountering the twin traumas of aircraft failures and an a global pandemic, Boeing now finds its fortunes being constrained mainly by limited capacity to keep up with demand.

That is a challenge across the industry, with supply underrunning demand in all areas—number of planes available, number of seats available, number of pilots available, number of ground support personnel available. Boeing is struggling to keep pace with demand, but that problem is far more congenial than facing a lack of demand.

It seems that Boeing really is recovering its former strength rapidly, at least on the commercial side. The company’s defense and space business will remain a work in progress for years to come, but during the critical years when the commercial business was faltering, the defense unit kept the company afloat.

The company’s strategy of sustaining a substantial presence in both commercial and military segments of the market thus appears to be vindicated.

As I walked out the front door of Boeing headquarters after receiving Darren Hulst’s briefing, a brightly painted Southwest AirlinesLUV 737 roared over from nearby Reagan National Airport and rapidly gained altitude into a cloudless blue sky.

It seemed like a harbinger of where Boeing Commercial Airplanes is headed.

As note above, Boeing contributes to my think tank.

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